The present invention relates generally to the field of software as a service (SaaS) and more particularly to determining the monetary cost of providing software as a service in cloud environments.
As cloud computing becomes the primary method for companies to provide services, some software is no longer sold as a product or by license. The monetary cost of providing a software as a service (SaaS) solution to an end-user is difficult to determine and so determining the price to charge the end-user is often inaccurate. Current cost metrics are typically determined using hardware consumption including disk space, processing time and Graphics Processing Unit (GPU) and memory usage. These prices are often static such as Amazon's® EC2 which provides tiered levels of service. Sometimes, a dynamic pricing scheme is used where the cost of the service is determined using analytics. This takes into account factors such as time of day, current load, competitors pricing etc.
When a company provides a service to its users the hardware cost is usually minimal compared to the cost of software engineering. Currently there is no measured way of charging for the monetary cost of investment in the software. One possible solution might be to see what other companies charge for similar services and to base the monetary cost around those charges. However, if a new service is being provided or a significant advantage being offered, then a base price needs to be determined that ensures the monetary cost of the software development and hardware costs are taken into account. For more mature services the monetary cost of servicing and updating the software also needs to be considered.